SFDR Overview

SUSTAINABILITY RISK POLICIES

Pursuant to the Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (“Sustainable Finance Disclosures Regulation” or “SFDR”), a sustainability risk is defined as “an environmental, social or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of the investment”. In the context of Freeport, sustainability risks, referred to in our ESG policy as ESG risks and opportunities, include those that have the potential to impact the operational or financial performance of a company, and ultimately, the Freeport portfolio.

Prior to making an investment, Freeport undertakes an initial due diligence process. As part of this review, Freeport seeks to identify the material risks associated with each prospective investment; this includes relevant and material ESG risks.

Our evaluation of risks begins with an overall assessment of the likely risks associated with an investment, as generally disclosed in the relevant fund’s investment policy and objectives. This is supplemented by the evaluation of data collected through Freeport’s ESG questionnaire, which is focused on uncovering those risks and opportunities most likely to be relevant to the investments Freeport makes.

The Co-ESG Officers and Investment Committee assess all risks identified during diligence, including ESG risks, alongside other relevant factors. Following this review, the investment committee makes an investment decision based on each respective fund’s investment policy and objectives. Identified ESG risks, along with ESG opportunities, continue to be assessed as part of Freeport’s investment management processes.

Please contact Co-ESG Officers if you have any questions on our approach to integrating ESG risks and opportunities throughout the investment process.

NO CONSIDERATION OF PRINCIPAL ADVERSE IMPACTS

Freeport does not consider the principal adverse impacts of its investment decisions on sustainability factors in the manner prescribed by Article 4 of the Disclosure Regulation.

Article 4 of SFDR requires fund managers to make a clear statement as to whether they consider the “principal adverse impacts” of investment decisions on sustainability factors. Although Freeport takes sustainability and ESG very seriously, it uses its own procedures, policies and metrics to assess its investment decisions, including any adverse impact(s) that may be material to review as part of its diligence or investment management processes. Our procedures and policies do not align with those prescribed under Article 4 of SFDR; however, Freeport considers that its approach is more appropriate and tailored to the investments that we make on behalf of our funds, and therefore are important to Freeport’s objective to deliver long-term risk adjusted returns to investors.

Accordingly, Freeport does not currently intend to consider the prescribed adverse impacts of our investment decisions on sustainability factors within the meaning of Article 4 of SFDR; however, Freeport will review these requirements on an on-going basis.

REMUNERATION POLICY

SFDR requires Freeport to include in its remuneration policy information on how its policy is consistent with the integration of sustainability risks.

Freeport pays staff a combination of fixed remuneration (salary and benefits) and variable remuneration (including bonus). Variable remuneration for relevant staff takes into account compliance with all Freeport’s policies and procedures, including those relating to the impact of sustainability risks on the investment decision making process.